Craft a Compensation Philosophy

Lay the groundwork for compensation that is competitive, cost effective, and brand aligned.

Onsite Workshop

Without a compensation philosophy:

  • The organization will experience difficulty managing compensation costs and decisions in a consistent manner.
  • The organization’s approach to compensation will not be tailored to its strategy.

By having a compensation philosophy:

  • The organization will pave the way towards pay transparency.
  • The organization can effectively manage compensation costs.
  • The right talent will be attracted to and retained by the organization through effective market positioning.

Module 1: Assess Current State

The Purpose

  • Discuss the organizational factors influencing compensation.

Key Benefits Achieved

  • Organizational insights that will impact the approach to compensation.

Activities: Outputs:
1.1 Identify and discuss compensation challenges.
1.2 Discuss internal and external factors influencing compensation.
  • Compensation Philosophy Worksheet

Module 2: Craft the Compensation Philosophy

The Purpose

  • Conduct a competitor analysis.
  • Develop compensation principles.
  • Determine target market positioning strategies.

Key Benefits Achieved

  • Drafted compensation philosophy.

Activities: Outputs:
2.1 Identify competitors for talent.
2.2 Uncover fundamental compensation principles.
2.3 Determine market positioning strategies and targets.
2.4 Draft the compensation philosophy.
  • Compensation Philosophy Worksheet
  • Compensation Philosophy Template

Module 3: Customize the Point Factor Tool

The Purpose

  • Select and customize factors aligned with the organization’s context.

Key Benefits Achieved

  • Customized and aligned point factor job evaluation tool.

Activities: Outputs:
3.1 Select strategically aligned factors.
  • Strategically aligned point factor tool
3.2 Customize factor definitions and levels.

Module 4: Customize the Point Factor Tool

The Purpose

  • Weight the factors and allocate points across factor levels.
  • Test the tool for bias and accuracy.

Key Benefits Achieved

  • Tested point factor tool.

Activities: Outputs:
4.1 Weight the factors.
4.2 Check for bias.
4.3 Allocate points to each level.
4.4 Test the tailored Point Factor Tool.
  • Customized and tested Point Factor Tool

Module 5: Next Steps and Wrap-Up

The Purpose

  • Ensure the point factor method is implemented and maintained effectively.

Key Benefits Achieved

  • Action plan to continue the job evaluation process.

Activities: Outputs:
5.1 Review tool testing results.
5.2 Develop an action plan.
  • Action plan

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